Circular No. F. No. 225/132/2023/ITA-II - Dated: 1-12-2023 - Processing of returns of income validly filed electronically with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases

Circular No. F. No. 225/132/2023/ITA-II - Dated: 16-10-2023 - Processing of returns with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases

Circular No. F. No. 225/132/2023/ITA-II - Dated: 31-1-2024 - Processing of returns of income validly filed electronically with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases

Overview

The Government of India, through the Ministry of Finance and the Central Board of Direct Taxes (CBDT), has issued orders regarding the processing of income tax returns filed electronically with refund claims, specifically for non-scrutiny cases. These orders, released on December 1, 2023, and January 31, 2024, address concerns related to technical issues or other factors outside the taxpayers' control that have prevented the processing of returns for the assessment years (AYs) 2018-19, 2019-20, and 2020-21.

Key Points from the Orders

1. Background and Necessity:

   • Technical problems and other non-taxpayer related reasons have delayed the processing of income tax returns for AYs 2018-19 to 2020-21.
   • This delay has led to taxpayers not receiving their due refunds, prompting the CBDT to issue these orders.

2. Relaxation of Time Limits:

   • To address these delays, the CBDT initially extended the deadline to January 31, 2024, for processing returns filed up to AY 2017-18 and for assessment years (AYs) 2018-19, 2019-20 and 2020-21.
   • Recognizing ongoing issues, the CBDT further extended the processing deadline for returns up to AY 2020-21 to April 30, 2024.

3. Conditions for Processing:

   • Returns can now be processed with the prior approval of higher tax authorities (Pr.CCIT/CCIT).
   • Specific exclusions apply, such as returns under scrutiny, returns showing or likely to show a payable demand, and returns unprocessed due to issues attributed to the taxpayer.

4. Administrative and Technical Support:

   • Upon receiving administrative approval, necessary technical support will be provided to the assessing officers for processing these returns.
   • The progress of these cases will be monitored by higher tax authorities.

5. Exclusions:

   • The relaxation does not apply to scrutiny cases, returns with payable demands, and those unprocessed due to taxpayer's fault.

6. Communication and Compliance:

   • The orders mandate widespread dissemination for compliance and are also available in Hindi.

Implications for Taxpayers

These orders from the CBDT offer relief to taxpayers who have faced delays in the processing of their income tax returns due to reasons beyond their control. By extending the time limits and providing clear guidelines for processing these returns, the government aims to alleviate the hardships faced by taxpayers and ensure they receive their rightful refunds.

Taxpayers with returns for AYs upto 2020-21 that have not been processed due to technical issues or other non-fault reasons are now given an extended opportunity to have their returns processed and to receive any refunds due. This move also emphasizes the government's commitment to addressing taxpayer grievances and ensuring efficient tax administration.

Conclusion

The relaxation of the prescribed time limits for the processing of income tax returns is a significant step towards resolving taxpayer grievances related to refund delays. By extending deadlines and setting clear conditions and exclusions, the CBDT aims to ensure that taxpayers receive their due refunds promptly while maintaining the integrity of the tax administration process.

Full Text:

Circular No. F. No. 225/132/2023/ITA-II - Dated: 1-12-2023 - Processing of returns of income validly filed electronically with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases

Circular No. F. No. 225/132/2023/ITA-II - Dated: 16-10-2023 - Processing of returns with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases

Circular No. F. No. 225/132/2023/ITA-II - Dated: 31-1-2024 - Processing of returns of income validly filed electronically with refund claims under section 143(1) of the Income-tax Act, 1961 beyond the prescribed time limits in non-scrutiny cases